20 Feb

Bank of Canada Hike Next Monthly Not Likely – Dr. Sherry Cooper DLC

General

Posted by: Michelle Zimmerman

Taking into account the current economic burdens presented by weaknesses in housing, oil, and trade, the Bank of Canada is unlikely to hike interest rates in its next meeting in March, Dominion Lending Centres chief economist Sherry Cooper predicted.

“Although job growth has been stronger than expected, wage gains have moderated and inflation pressures are muted,” Cooper wrote.

And while the most in-demand markets will continue to see housing price growth, such increases will be relatively muted compared to the highs achieved in previous years – and will actually be somewhat offset by pronounced slowdown elsewhere.

“We are likely in store for a prolonged period of modest housing gains in the Greater Golden Horseshoe, stability or softening in much of British Columbia and further weakening in the Prairies, Alberta, and Newfoundland & Labrador.”

The running theme this year would be sluggish sales and glacial-pace price growth, Cooper stated.

“While there will still be some significant regional divergences, there is no need for further policy actions to affect demand. Indeed, a growing chorus has been calling for lowering the mortgage qualification rate from the posted five-year fixed rate, currently 5.34%, to closer to the actual conventional rate, about 200 basis points lower.”

Read more: Rate hikes will impede many Canadians’ home-buying plans

In early January, money manager BlackRock Inc. noted that the BoC will almost certainly keep its interest rates flat until at least next year, “given increased market volatility and more restrictive financial conditions.”

“The bank has latitude to go on an extended pause,” BlackRock head of Canadian fixed income Aubrey Basdeo told BNN Bloomberg. “What’s the rush to get to neutral if inflation’s not an issue?”

Reduced inflationary pressure stemming from lower petroleum prices will also play a major role.

“With some of the volatility we’ve seen in the financial markets and the lower oil prices’ impact on economic activity in Western Canada, the Bank of Canada can afford to be cautious and will be in no rush to their next rate hike,” TD Bank senior economist James Marple said in late December.

19 Feb

GET TO KNOW TITLE INSURANCE

General

Posted by: Michelle Zimmerman

Geoff Lee of Dominion Lending Centres – Vancouver, has some great information below on Title Insurance and the need for it!

Are you officially Mortgage Free? CONGRATULATIONS! That is a monumental milestone to achieve!

With that significant accomplishment, you should look at obtaining a Title Insurance Policy. What most people don’t realize is that when you had a mortgage, the lender will likely have had this in place for you. Once your mortgage is paid out in full the insurance is no longer in place. It is crucial that once your final payment is made that you, as a home owner, now get a policy.

What is Title Insurance? Good question!

Title Insurance protects you, the homeowner. It’s not like traditional insurance in that it does not ONLY cover things that might happen, but it also covers things such as property defects that have already occurred in the past.

A title insurance homeowner policy will cover:

  • Forgery – If someone forges your signature on a registered document that entitles them to sell or mortgage your home.
  • Duty To Defend – If you experience title risk, the policy will cover the legal fees and costs associated with restoring and protecting your title.
  • Lack of Building Permits – Prior to purchasing the home, if there were renovations performed without the proper building permits you may be required to remove or fix the structure.
  • Fraud – If someone fraudulently transfers your property without your consent.
  • Encroachments – If a structure built by a previous owner is outside the property boundaries, or if a neighbour builds a structure that is on your property.

Title Insurance offers you peace of mind if anything should happen to your property once you are the owner. It is relatively low cost, on average coming in at $200-$400. It is a one-time purchase and does not need to be purchased each year. More than reasonable right?

If you are still on the fence about obtaining title insurance, we’ve recently had a client who experienced title fraud:

A woman went to her bank to make a payment on a line of credit that was secured by a mortgage on her property. When she arrived, she was told that her $30,000 line of credit had been paid in full and that according to the lawyer who sent the funds, her house had been sold.

This left her quite perplexed, so she followed up with the land registry office. They confirmed the sale of the property for $350,000 and that a new mortgage was registered on the property for $325,000. The woman was stunned to find out that she had been the victim of a title fraud scheme—and that the fraudsters had collected $350,000 on the deal.

Thankfully, in the above case the woman was covered by a Title Insurance Policy which fully covered all her legal fees to remove the mortgage from title and rightfully transfer it back to her. Having the coverage saved her approximately $12,000 in legal fees, time, and stress.

Your home is a sizable investment and one you worked hard to purchase! Title Insurance can protect you and your property should there be anything that comes up. For the $200-$400 it costs, we feel that’s a low-price tag for peace of mind. Ready to get a quote? Let us help you by contacting Dominion Lending Centres mortgage professional to set up your Title Insurance Policy!

31 Jan

LOOKING FOR A MORTGAGE… YOU BETTER KNOW YOUR CREDIT SCORE

General

Posted by: Michelle Zimmerman

Over the last month, as the big banks and many of our monolines mortgage lenders wind down their fiscal year, we are starting to see some very obvious changes in what your credit score can get you.

I heard a few months ago that 720 beacons were going to become the new 650. The 650 beacon credit score for many years was the mid-range norm for most mortgage lenders. Today on many of the sites we use, we are seeing that the primary borrower must have a credit score of 720 and the secondary beacon can’t be below 650. It’s a big change from what we have seen in the past.

There are more changes coming as the banks will need to set aside more balance sheet if your mortgage is conventional. The one report I read said that if your credit score is lower, then the banks will now need to set aside 1.5% or possibly more if the score is low enough. That of course will then mean that an investor will need to be compensated more for having that in their portfolio, aka higher rates for you on a conventional mortgage.

If you are in the market for a house and you don’t know where to start, at least contact Dominion Lending Centres mortgage broker who can guide you through the process and let you know where you start.  If you use a DLC broker, they can set you up with a CleverCredit account and you can work together to make sure your credit is strong enough to apply for a mortgage when the time comes.

Len Lane

LEN LANE

Dominion Lending Centres – Mortgage Professional
Len is the owner and founder f DLC Brokers For Life based in Edmonton, AB.

25 Oct

Bank of Canada Raises Interest Rate

General

Posted by: Michelle Zimmerman

The Bank of Canada announced today that mortgage rates have increased to 1.3/4 per cent.  Consumers first instinct might be to panic a bit, but with the stability that Canada’s economy is experiencing.  This was expected and was projected to the public earlier this year.

Although it does seem stressful and daunting to many home owners, I am here to help alleviate that feeling.  Message me for a mortgage check up to see what the future holds for you and how I can help eliminate that feeling.

www.bankofcanada.ca